HC Deb 14 May 1998 vol 312 cc510-1
11. Mrs. Louise Ellman (Liverpool, Riverside)

What plans she has to change the regulatory framework for the utilities to give increased priority to consumers' interests. [40963]

The Minister for Science, Energy and Industry (Mr. John Battle)

It is the Government's intention that consumers' interests should be put at the heart of the regulatory system. We said that we would change that system, and we are working towards that. That is why my right hon. Friend the President of the Board of Trade published on 25 March a Green Paper on utility regulation—"A Fair Deal for Consumers: Modernising the Framework for Utility Regulation".

Mrs. Ellman

Will my hon. Friend give me a categorical assurance that the new regulations will be strong enough to deal with the casualties of Tory utilities privatisation? Will they be able to deal with the legacy of fuel poverty, whereby poorer people get the worst deal? Will they be able to deal with the outrageous situation whereby the privatised water companies have increased bills to domestic consumers by an average of more than 95 per cent. since privatisation?

Will my hon. Friend consider making the new regional chambers the focal point of consumer representation in the regions, perhaps by enabling them to call hearings where the utility companies have to come to be called to account by public representatives?

Mr. Battle

I can give my hon. Friend that absolute assurance. The Green Paper includes a substantial programme of action inviting the regulators and the industry to develop a clear action plan to ensure that poorer consumers enjoy more of the benefits of the privatisation programme. As she rightly said, we inherited a legacy of fuel poverty and there is a horrendous difference between those who can use direct debit schemes and those who are in the trap of having self-disconnecting meters. We have not just been waiting for the White Paper; our response to fuel poverty included reducing VAT on fuel. Proposals for consultation of consumers are also included in the Green Paper.

Dr. Vincent Cable (Twickenham)

Is the Minister aware of a serious anomaly in the regulation of the utilities that has arisen this morning because a consortium of local authorities representing the three major parties has been obliged to pull out of the terminal 5 inquiry because of a lack of funding, whereas a regulated monopoly—BAA—is continuing with the support of taxpayers' money because it has been able to offset its costs against tax? Will he undertake to speak to the Chancellor and the Secretary of State for the Environment, Transport and the Regions to ensure that that undemocratic anomaly is addressed as soon as possible?

Mr. Battle

I shall certainly speak to my colleagues in other Departments. If the hon. Gentleman has not had an opportunity to see the Green Paper, I should tell him that it is confined to gas, water, electricity and telecoms. I shall take the matter further with colleagues at the Department of the Environment, Transport and the Regions.

Mr. Eric Forth (Bromley and Chislehurst)

Before the Minister gets too impressed by his Back Benchers' rhetoric and crocodile tears over increases in some utility prices, will he take into account the impact of the huge council tax increases levied by Labour-controlled local authorities, and set them against the lousy level of services that most of those authorities deliver?

Mr. Battle

I would be delighted to get carried away with the record of Labour councils, which have done a brilliant job over the years, under incredible pressure from a Conservative Government. They delivered services as the Conservative Government reduced their budgets year on year. Indeed, those councils were usually the ones picking up the pieces following Tory legislation.

Mr. David Drew (Stroud)

In my area, we have had the road dug up for the past two months, thanks to Severn Trent Water, the telephones were off on Monday, thanks to BT, and it is guaranteed that any train run by Great Western Trains will be late into Paddington. Does my hon. Friend agree that we cannot wait a moment longer for greater powers for the regulator?

Mr. Battle

As my hon. Friend suggests, the Green Paper proposes to improve the accountability, consistency and transparency of the regulatory process. We believed that it needed reforming; we stated in opposition that we would set about that task. The Green Paper is out for consultation, which closes on 31 May. We will then act on that consultation. Consumer groups and the utilities alike have responded very positively to the Green Paper.